Soft console gaming category causes GameStop sales slip

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GRAPEVINE, Texas — GameStop reported that total global sales for the fourth quarter of 2012 were $3.56 billion compared with $3.58 billion in the prior year quarter. Consolidated comparable-store sales decreased 4.6% compared with the prior year quarter.

Paul Raines, chief executive officer, stated, “While 2012 was a challenging year for console gaming, we focused on factors within our control. We expanded our market leadership position, maintained our financial strength and controlled our spending. Perhaps most importantly, we invested in our mobile and digital businesses to position the company for future success. These channels delivered as planned and significantly contributed to our highest ever gross margin and profitability.”

GameStop’s fourth quarter net earnings were $261.1 million compared to net earnings of $174.7 million in the prior year quarter. Diluted earnings per share were $2.15 compared with diluted earnings per share of $1.27 in the prior year quarter.

For fiscal year 2012, total global sales were $8.89 billion, a 7% decrease compared with $9.55 billion in fiscal 2011. Full-year consolidated comparable-store sales declined 8% compared with fiscal 2011. Digital receipts and mobile sales drove a 21.2% increase in the other category. New hardware, new software and pre-owned sales each declined year-over-year primarily due to the effect of the longevity of the current console cycle.

GameStop’s fiscal 2012 net loss was $269.7 million compared to net earnings of $339.9 million in fiscal 2011. Diluted loss per share was $2.13 compared to diluted earnings per share of $2.41 in fiscal 2011.

Raines stated, “As we look towards the start of the new console cycle, our industry market model indicates a return to growth with the launch of new game systems. GameStop is strong, healthy and ready to lead the industry and its customers into the next phase of gaming.”